Decisions — Square Pegs

Sometimes even the people who enforce tax laws go off on the wrong track.

In T.C. Memo. 2013-161 (Kadimah Chapter Kiryat Ungvar), the IRS concluded a Rabbi’s son was an employee of his father’s non-profit religious organization because he took care of a house the organization owned—after the organization sold it.

Judge Kerrigan disagreed, saying “It appears that respondent was trying to fit a square peg into a round hole by arguing Mr. Schwartz was an employee.”

In T.C. Memo. 2013-162 (Buchanan), the IRS took the position that the taxpayer’s federal tax return should not be treated as a joint return for purposes of innocent spouse relief even though she appeared to elect joint status.

Here, Judge Paris says “Respondent’s interpretation of the caselaw is misguided. … The caselaw may not be used to allow a taxpayer to invalidate an otherwise properly signed joint return.”

Taxing Lesson: Some things are not easy, even when you know the rules.

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